PROGRAMMATIC: TAPPING THE BOOM IN DIGITAL AUDIO

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In this age of mobility, the intensifying interest around audio is being driven by a simple fact: Consumers love digital audio. And marketers are taking notice. As the new Ad Age survey with The Trade Desk discovered, smart marketers are using programmatic technology to take advantage of this rapidly growing area.

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The songs and stories we choose to listen to reflect our moods and lifestyles, suit our current activities and fill our minds as we go about daily life. In the age of mobility, audio also flows across the places of our lives as no other format can, from the shaving mirror and kitchen counter, to the car or bike, to the office, gym or dinner party. Because it’s uniquely intimate and immersive, audio—unlike display and video—doesn’t depend on our undivided attention to make an impression. Audio makes it possible to deliver impressions without fearing overcrowded pages, ad blockers, adjacent browser tabs or even fraudsters.

And marketers are taking notice. It may be the least flashy of digital channels, but more than a century after the introduction of broadcast radio, audio is hotter than ever.

Even without images, the rise of digital audio—both as a medium and as an ad opportunity—is easy to see. Industry analysts put global monthly listenership at somewhere between 600 million and 900 million. A recent XAPPmedia report estimates that of 1 billion streaming listeners globally, 89% to 91% choose ad-supported channels. In the U.S. alone, ad-supported revenue for internet radio will increase from about $2 billion in 2014 to more than $4 billion in 2017, according to a report by eMarketer and BIA/Kelsey. A new Advertising Age survey with The Trade Desk corroborates this impending boom; while the adoption numbers for digital audio advertising are relatively low (Figure 1), they are expected to grow more than 65% in the next year. At the same time, 38.6% of respondents say digital audio is an important part of their marketing mix.

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The emergence of programmatic audio continues the ongoing transformation of audio advertising sparked by the rise of streaming services. Traditionally, the radio ecosystem was highly fragmented, revolving largely around spot buys in local markets with a handful of larger buys through station groups. With no integrated response mechanism, marketers could either focus on top-of-the-funnel branding and awareness, or they could try to drive listeners to local retailers, dealerships and toll-free numbers, all with few options to accurately measure the effectiveness of a given buy. Inventory was plentiful but cluttered, and anything but premium-feeling. Buyers could choose among various formats serving broad demographics and interests—sports, talk, oldies, Top 40—but finer-grained targeting was impossible.

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For marketers already using programmatic to buy other formats, the opportunity to target, buy and measure audio through the same console may make them more likely to add it to their campaigns. For others, the availability of programmatic buying across every digital format—display, video and now audio—may signal that the time has come to embrace programmatic for every kind of campaign. A majority of survey respondents (55.1%) felt that audio may be the tipping point for the adoption of programmatic across channels (Figure 5). Among those who are already using or planning to use programmatic technologies for digital audio, that figure jumps to 64.3%.

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